FCRA amendment

Individuals, companies, associations, NGOs generally receive financial contributions from inside and outside the country. The latest FCRA amendment is aimed at regulating the flow of funds from outside the country. It proposed reduction of allowed foreign funds contribution level from 50% to 20% for NGOs in terms of administrative costs. It made Aadhar cards as a mandatory identification documents for all directors, office bearers, and other functionaries in the NGO. It seeks to prohibit flow of foreign funds to associations and persons not registered as a recipient of foreign contribution. The critics are arguing that the FCRA will debilitate the functioning of the NGOs. But the government claims that the amendment seeks to regulate the flow of funds keeping in mind the reasons of national dimension of internal security. But it is suspected that the amendment is specifically meant for monitoring, control and if possible prohibition of flow of foreign funds to NGOs who have opposing views of the social, political and economic policies of the current regime. Some also observe that this would entail destruction of the small NGOs. The timing of the passage of the FCRA amendment bill in the middle of a pandemic in a Lok Sabha with no question hour somewhat strengthens this view.

Insolvency and Bankruptcy code amendment

Due to the impact of the Covid19 many firms and companies had to take their shutters down, thanks to the unplanned lockdown induced disruptions. These led many companies come closer to default on their debt. It subsequently led the government to pass the Insolvency and Bankruptcy code amendment bill into an act. Under the new provisions, section 10 A has been added. IBC provided for initiation of the process of CIRP i.e. corporate insolvency resolution process. The newly introduced section 10 A now states that no application for CIRP can be filed for any default which arose on or after the period of 25^th March, 2020. This is applicable for 6 months and periods beyond that, not exceeding one year from that period. The amendment also introduced section 66(3) which suspended the application of wrongful trading provisions under the IBC when 10A is applicable. It is argued that the defaults occurring due to the pandemic could have been tackled separately. It has also been suggested that decision on classification of the debt defaults and the causes could have been left to the National Company Law Tribunal.

Essential commodities act

The Essential Commodities Act was amended by removal of pulses, cereals, oilseeds, potatoes, edible oil, and onions from the category of essential commodities. It is supposedly directed to bring it confidence to the private investors who are involved with businesses dealing in procurement and distribution operations of such commodities. The business in such commodities is supposed to gain efficiency by freer involvement of the private players. It is expected to bring economies of scale in the commodities removed from the essential list. It is expected that in the long run with bringing in of the competition, the market for agricultural commodities will see efficiency and better infrastructure for the farmers like cold storage and warehouses. Some observers note that the government heeded to the suggestion made in economic survey to do away with the blanket stock limits of the essential commodities. Critics opine that this amendment would lead to corporatization of the farmlands in the long run.